Ocean Transportation – Trends, Capacity, Congestion and Risk Executive Seminar September, 2005

Ocean Transportation Foundation questions for the Ocean Transportation discussion … How are you addressing the issue of ocean port congestion and the potential for service interruptions at ports? What criteria are important to you when selecting ocean carriers? Are your ocean carriers meeting (or exceeding) your expectations? What metrics are important to you in assessing the effectiveness of ocean transportation? Where are the gaps?

Ocean Volumes by Origin Region While not a surprise, ocean volumes inbound to North America originate predominately in China/Hong Kong and the Pacific Rim.

Leading Origin and Destination Ports Ocean volume tends to be concentrated in a few ports.

Volume Peaks – Timing and Magnitude Trans-Pacific Shipments Trans-Atlantic Shipments

Shifts in Port Usage Recent disruptions at ports are encouraging shippers to diversify their port usage.

Selection of Non-North American Ports Since port selection is most often in the hands of the shipper, the shipper frequently has the lead in assessing port capabilities and risks.

Investigating Non-North American Ports Do you visit port operations at non-North American ports? What issues do you typically investigate?

Investigating North American Ports Do you visit port operations at North American ports? What issues do you typically investigate?

Causes of Port Congestion What do you typically find are the issues?

Strategies for Port Congestion What actions, if any, are you taking to alleviate port congestion?

Ocean Carrier Selection Criteria What criteria are important in selecting ocean carriers?

Ocean Carrier Satisfaction Ratings How are carriers performing? What are the major gaps?

Enforcing Carrier Accountability What is the most effective strategy for improving performance?

Effectiveness of Current Compliance Programs Rates are discussed more often than performance. Is that the right balance?

Ocean Transportation Performance What are the most significant opportunities to improve ocean transportation performance?

Ocean Carrier Performance – High’s and Low’s What differentiates the best performers from the rest?

Ocean Transportation – Learnings There continues to be a significant concentration of freight flowing through a few ports but shippers are planning to diversify port usage. Despite the risk of disruptions, shipper focus on port issues is limited. While ocean carriers are not performing well, they tend to receive higher ratings than other modes. It may be that expectations are not as high as they should be. Service level experiences for individual shippers can vary significantly from average performances or best practice. There may be a limited understanding of what goals are reasonable and achievable.

Questions?